Asia's naphtha crack fell to an almost 17-month low of $46.48 a tonne on Wednesday on abundant supplies that showed no signs of retreat in the short term, traders said. South Korea's Hanwha Total was looking to buy naphtha for second-half July arrival at Daesan butt the results were not known. It was the first buyer in South Korea to seek cargoes for second-half July and this came just two days after it had bought a cargo to be delivered in first-half July to Daesan.
Japanese trader Marubeni on the other hand has on late Tuesday bought from India's Bharat Petroleum Corp Ltd (BPCL) a 30,000-tonne naphtha cargo from India for June 24-26 loading from Mumbai at a premium below $2 a tonne to Middle East quotes on a free-on-board (FOB) basis, traders said. Not only was this sharply lower than the $14 a tonne premium BPCL had previously got for an April cargo but it was the lowest for the state-owned refiner since January 2015, Reuters data showed.
"There's too much supply coming to Asia and too much supply from domestic refineries," said a North Asian trader. Recent cracker outages that have affected run rates in Taiwan, South Korea and Indonesia were adding to sellers' woes, traders said. The largest of Taiwanese Formosa Petrochemical Corp's three naphtha crackers will operate at reduced rates of 90-95 percent of its 1.2 million tonnes per year (tpy) capacity until late June.